Profit before salary – Newspaper Kommersant No. 243 (7444) of 12/29/2022

Microfinance companies are finishing another crisis year with high net profit and loans. For many companies, they were higher than both 2021 and initial forecasts for 2022. Next year, market participants are waiting for the consolidation of the segment around the largest players who will be able to maintain profitability in the face of regulatory restrictions. Experts believe that market growth will be limited mainly by the reduction in demand for loans.

The results of microfinance companies in 2022 will be noticeably higher than in 2021, and better than forecasts for 2022, showed a Kommersant survey of the largest MFIs.

So, according to preliminary estimates, Zaimer’s net profit will amount to 3 billion rubles – this is a historical record for the company, says its CEO Roman Makarov. Lime Loan was able to fully compensate for the drop in results in the second quarter with a strong increase in loans in the third and fourth. Loan volumes for the second half of the year have already exceeded the year-on-year figures by 25%, adds Olesya Kisileva, Managing Director of the company. The main indicators for the year will be higher than the figures that were laid down at the beginning of the year, confirms Marat Abbyasov, commercial director of the MigCredit MFC.

“Despite the difficult economic situation, the MFI market will show growth at the level of 10-15% year-on-year. This is a good indicator in the current conditions, although it is half the growth rate that the market showed before the pandemic (according to the Central Bank, in 2019 the market volume grew by almost 30%.— “b”),” says Mr. Abbyasov. Flexible credit risk management (switching from long installation loans to short payday loans), less dependence on the key rate than banks (more than 360% per annum for the most popular payday loans at the highest key rate this year 20%, and now – 7.5%), a short average term of microloans (often up to 30 days) allow MFIs to flexibly revise their credit policy, explains Igor Smirnov, CEO of Creditter MCC.

However, not everyone is optimistic. The data of the weekly operational monitoring of the SRO “MiR” show that the largest companies only in the second decade of December returned to the volume of loans that were in February, said the chairman of the board of the SRO “MiR” Elman Mehdiyev. In response to the “shocks”, large companies significantly tightened the assessment of the solvency of borrowers and reduced the issuance, he explains, the issuance of “refuseniks” flowed into medium and small MFIs, working primarily offline.

In 2023, market participants expect growth of 10-20%, industry consolidation around the largest players and tougher competition between them. Risk appetite of creditors will continue to decline in the face of the next round of market regulation, Roman Makarov believes.

“Macroprudential limits will have an impact, lowering the daily rate to 0.8% (currently 1%.— “b”), limiting overpayments (the maximum level of overpayment on a loan, taking into account interest, fines and penalties, this year 1.5x, in 2023 1.3x.— “b”). They will lead to new changes in the scoring models of MFIs, and will encourage companies to focus on quality clients,” adds Andrey Kleimenov, CEO of the Eqvanta group of companies. As a result, according to the Central Bank, about 300 companies, that is, a quarter of all participants, may leave the market. “Therefore, large players can increase their revenue even more,” Mr. Kleimenov expects.

At the same time, experts doubt that the tightening of regulation of the microfinance segment will be the main constraint on the growth of the industry next year. The main limitation on issuance, according to Mark Savichenko, chief analyst at Ivolga Capital, will be on the demand side, which will fall along with a decrease in consumption.

Polina Trifonova